India Plans to Invest in Gold Mining

They are calling it the great Indian gold rush. Within months, Indian officials are expected to auction licences for new gold mines across the country, and abandoned colonial-era mines are set to be revived.

India is the world’s largest consumer of the precious metal, importing more than 1,000 tonnes a year. In August alone, 120 tonnes were brought in, and demand is expected to rise still further in the runup to Diwali and weddings season. Local production of gold totals less than two tonnes.

Successive governments have struggled to turn Indians away from gold, which economists say accounts for almost a third of the country’s deficit.

Now ministers want to increase domestic supply and believe gold worth more than £2.5bn can be mined in the dusty hills of Kolar, in the southern state of Karnataka, with more to come from other sites in the west and centre of the country.

Balvinder Kumar, of the mines ministry, told the Guardian: “There have been investigations and explorations by state governments and we believe there is gold there that can be exploited. These are some very deep and old mines. We will put about 80 [mines] to auction within two or three months.”

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Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency
trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.

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